1. 1 “Can Lean Assist With A Michigan Manufacturing Improvement Effort” Another Suggestion: How Do We Make “Michigan Lean Enterprise Systems Success” A Competitive Advantage To Draw New Companies

2. 2  A few years ago Henry Ford Developed “Ford Mass Production System” – IN MICHIGAN- and the world followed.  In the 50’s and 60’s the Frost/Scanlon Plan was refined and developed at MSU-IN MICHIGAN-reaching most of West Michigan and several great companies in the country.  Toyota trained under Henry Ford-IN MICHIGAN-and developed a new enterprise system known as TPS or Lean. The world is attempting to follow. 2

3. 3  I have worked for many years on the East Side of the state with GM. largely in the Power Train Group.  I have worked outside the state with GM in the mid 1980’s.  Lets Discuss my Massachusetts experience  I have worked in Kentucky with Toyota in the new Power Train Operations.  Since 1996 I have worked in West Michigan with automotive supplier Donnelly Corporation and Tiara Yachts. 3

4. 4 4

5. 5 Developing a lean enterprise system allowing for the setting of STANDARDS aimed at continuous improvement by ALL team members through the constant elimination of waste. 2009-2010 University of Michigan 5

6. 6 “Something used as a rule or ‘BASIS OF COMPARISON’ to evaluate quality, quantity, value, etc..” 6 2009-2010 University of Michigan

7. 7 “What you are is where you were when you hired into the company” Companies have developed very unique cultures 7

8. 8 The best definition I have found: Culture is “a set of shared values that emerges from the history of experience and the story that is produced out of that. It is the past that gives us our identity and corrals our behaviors in order to preserve that identity” “Community, the structure of belonging” Author: Peter Block Publisher: Berrett-Koehler Inc. 2008-2009 8

9. 9 IIt is certainly one of the answers. WWe are hindered by a poor labor and management relationship as viewed outside Michigan. TThis is not about poor management, labor unions or workforce dedication. It is about showing we can work TOGETHER with any current condition for the success of business and therefore every team member in Michigan. IIf we could show our ability to integrate an effective people engagement system with lean systems and process innovation we could easily convince industries to locate and grow in Michigan.

10. 10 This Is A System Failure, Not A People Failure! Your job as a Lean Leader is to make it easier for Team Members to Succeed than to Fail.

11. 11  Lean, if implemented properly as an enterprise system will allow solving many of our relationship issues… PeopleBusiness Improved Job Security Strong Identity with my ability to drive improvement Better opportunity for wage and benefit improvement Improved safety and working conditions Understanding the business reality and alignment with company goals Reduced cost in all aspects of the business Quicker to market and throughput Continuous improved quality to both customers and internal measures Improved management employee and union relationships for all stakeholders success 11

12. 12 Broad Research Has Shown Only About 25% Of Workers: Are fully engaged in their work Are enthusiastic about team and organization goals Feel they are fully enabled to execute their goals Have a clear line of sight between their work and their teams organizational goals Work in an open trust-filled environment How Are We Doing With People Systems?

13. 13 Traditional Mass Production All Materials Necessary to Run Any Schedule Continuous Run Productivity Safety Quality Cost by Maximum Run Inspect and repair Classifications of Support Float for Breakdown Labor Efficiency Measurable Large I.E. / Mfg. Engineering Largest Possible Batch Run Skilled Trade Response to Work Orders Daily Schedule Run by Production Without Plant-wide Communicated Sequence (Prepared Ground Work) Maximize Equipment Run Time (repair only after break down) Labor 13

14. 14 “Many good companies try to practice kaizen and use various TPS tools. But what is important is having all the elements together as a system. It must be practiced every day in a very consistent manner - not in spurts - in concrete way on the shop floor.”

15. 15 My Vision of TPS Just-In-Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Standards Knowledge Batch of One Capability Job Rotation Standardized Work Continuous Improvement Teams Andon Boards Suggestion System Visual Factory and 5S Total Productive Maintenance Equipment Reliability (rock)

16. 16 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) Just In Time The delivery of materials and resources at the location where they are needed, at the time they are needed, and the quantity required. Just In Time The delivery of materials and resources at the location where they are needed, at the time they are needed, and the quantity required.

17. 17 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) Level Production Averaging volume and model mix evenly over the span of production to ensure continuous production. Level Production Averaging volume and model mix evenly over the span of production to ensure continuous production.

18. 18 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) Standards Knowledge Annual Plans for Improvement A cascading annual planning and goal setting process aimed at fostering team member participation toward continuous improvement through waste reduction. Also the various team involvement processes identifying for all team members how to get involved. Annual Plans for Improvement A cascading annual planning and goal setting process aimed at fostering team member participation toward continuous improvement through waste reduction. Also the various team involvement processes identifying for all team members how to get involved.

19. 19 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) Equipment Reliability Combines the purchase of machinery with the proper capacity and cycle time with preventative maintenance and total productive maintenance to support the required uptime, meeting the needs of the Just-In- Time and In Station Process Control pillars. Equipment Reliability Combines the purchase of machinery with the proper capacity and cycle time with preventative maintenance and total productive maintenance to support the required uptime, meeting the needs of the Just-In- Time and In Station Process Control pillars.

20. 20 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) In Station Process Control Extends far beyond quality control and is used to drive problem solving in all areas: tooling costs, and total area management by the team. This method requires all engineering functions to rethink their position on equipment capability and mistake proofing systems to achieve maximum uptime by eliminating potential stop points. In Station Process Control Extends far beyond quality control and is used to drive problem solving in all areas: tooling costs, and total area management by the team. This method requires all engineering functions to rethink their position on equipment capability and mistake proofing systems to achieve maximum uptime by eliminating potential stop points.

21. 21 Just-In- Time In Station Process Control Standards Aimed at Continuous Improvement Productivity T/M Morale Quality Cost Safety Solid Support Solid Support Level Production (formulas, policies) Equipment Reliability (rock) People Need to be developed with the inherent and acquired skills, physical and mental capabilities and motivation necessary to maintain and operate a lean manufacturing system effectively. Must be accountable for achieving clearly defined, common goals through continuous improvement. People Need to be developed with the inherent and acquired skills, physical and mental capabilities and motivation necessary to maintain and operate a lean manufacturing system effectively. Must be accountable for achieving clearly defined, common goals through continuous improvement.

22. 22 Total Employee Involvement Scanlon Principle Identity Competency Participation Equity Total Employee Involvement OR Lean Manufacturing System Level Production Just-In-Time Visual Delivery System Machine Reliability Preventative Maintenance Total Productive Maintenance Stop the Line Traffic Light System Mistake Proofing In-Station-Process-Control

23. 23 Toyota Is 50 Times More Scanlonized Than We Have Ever Thought Of Being And They Have Never Heard The Term ! Joanne DuQuette, VP of Human Resources, speaking to the Donnelly executive team

24. 24 “Brilliant process management is our strategy. We get brilliant results from average people managing brilliant processes. We observe that our competitors often get average (or worse) results from brilliant people managing broken processes.” Mr. Cho Vice Chairman of Toyota

25. 25 Customer Advances Process R & D TPSTPS Advanced Product Planning TPS Marketing Production Engineering Product Design Manufacturing Tooling Engineering Product Planning Human Resources Product Engineering Sales Corporate Management Team Financial TPSTPS Product Launch Cycle (Updated Improved Standards) Life Cycle Of Product Achieving Lean Leadership (Continuous Improvement) At lowest possible cost TPS Highest Possible Quality

26. 26  Lean Enterprise Systems are the only way to make our Michigan Companies Successful and Sustainable

27. 27 There is a Roadmap “The Leadership Roadmap Book” This is an executive level book aimed at accomplishing your lean roadmap. Co-Authors Russ Scaffede Dwane Baumgardner To answer any questions around this presentation please feel free to contact Russ Scaffede direct at: email info@leanprocess.cominfo@leanprocess.com phone (US 616-335-3053) For further assistance regarding this lean program please contact Sandra Hines at UM: 734-647-7176 hinesone@umich.edu